Long Term Disability Denial
Below, please find a brief discussion about some of the topics that people often call me about when considering whether to sue for a long-term disability benefits denial.
Below, I have dealt with the following issues:
1.Appeal or sue?
2.Total disability/Any Occupation denials
3.Paid insurance company assessors
1. Long Term disability Denial – should you appeal or should you sue?
If you are reading this, you have probably been denied long term disability benefits by your LTD insurance carrier. Whether the denial was made by one of the well-known disability companies like Manulife, TD, Great West Life, Desjardins, or others, there is normally an opportunity to “appeal” or dispute the initial denial.
However, despite the ability to appeal, for the purposes of the limitation period to sue the insurance company you should treat the initial denial as the date when the clock starts ticking. That means that you should usually consider that the clock starts no later than the first denial. If you do not file the claim by the expiry of the limitation period then your right to sue may be taken away. If a client calls me and wants to try the appeal before suing, I normally discuss the limitation period with them and we set a date by which to hear from the insurer or sue.
Some people have a union that can assist them in appealing their disability denial. Unfortunately, I am often confronted with unions that are non-responsive to their union members. The most tragic cases that I have seen are ones where the claimant has been denied, their union has negotiated away their right to sue and they are required to go to arbitration with their union and the union is not assisting their member. The cases that I have had like that have posed very serious challenges.
Many people do not want to hire a lawyer or start a lawsuit unless they have no other options left. That is understandable – very few of my clients want to be in litigation – they just have no other choice. But you do not want the appeal process to drag on and it prejudices your ability to sue. I normally recommend that clients at least open a “wait and see” file with us so that we can monitor what occurs (I typically do not charge for that).
In some cases, I simply give clients the opinion that the insurer is not going to change their mind and they should just sue. That is not because their case is without merit, it’s just because I have a pretty good sense of which insurers are going to hold firm in certain types of cases. Some of the insurers take very firm positions in cases where the disability is “not objective” – ie: a chronic pain case, a psychological case, or a “level of pain” case.
My perspective is that, if a case is likely to go the litigation route and eventually result in a trial or settlement (pre-trial resolution), then there isn’t much point in delaying that. Fighting with an insurance company is stressful enough and the time spent doing that is best minimized.
In one recent case that I had, we sent a letter to the insurance company advising of the fact that we were issuing our lawsuit with the Court and the insurer responded by immediately re-instating the claimant and paying all of the benefits owing from the date of termination. Obviously, that was not the norm, but it does show that the insurers are sometimes taking notice of a lawyer coming on board and moving to litigation and perhaps there is a supervisor reviewing the matter. In that particular case, I had just concluded a successful claim against the exact same insurer with the exact same employer about a month before.
2. My Long Term Disability Carrier says that I do not meet the Total Disability/Any Occupation Test
I often receive calls from people who have been denied long term disability benefits (LTD benefits) or income replacement benefits (accident benefits) on the basis that their insurer says that they do not meet the “any occupation” test.
The “Any Occupation” test for disability benefits typically becomes the governing test after two years of disability. When you first read it, it is a scary thing – “Any occupation” – so does that mean if a CEO can’t do their job, but can now work for 10 minutes every second day as a tele-marketer the insurer can cut them off? Thankfully, the answer to that question is no.
The meaning of the “any occupation” test has been studied and interpreted by our Courts in Ontario and elsewhere and it is clear that the Courts favour reasonableness when interpreting the provision. It is also important to remember that the injuries must be looked at as a whole – it is not appropriate for an insurer, for instance, to say that you are physically able to return to work and ignore the effects of emotional and cognitive problems.
The Courts will look at whether the overall employment is reasonable considering all of its duties, they will consider the reasonableness of the type of job, the type of compensation and other factors when considering whether the person meets the any occupation test. It is imperative that you speak with a lawyer if you have been denied benefits.
It is very important that you receive independent advice about whether the insurer’s denial is appropriate and whether there are any steps that you need to take. There are time-limits that can also take away your right to sue.
3. The Long Term disability carrier’s paid assessor says that I am not disabled
Long term disability insurance companies such as Manulife, Sunlife, Great West Life, TD, Desjardins and others will often consult with physicians when determining whether or not an insured should be paid short or long term disability benefits.
People are often surprised by the process, the results and the comments made by those physicians. The first thing that often surprises people is the use of medical consultants who review the documents on file and determine whether a person is able to work or not. People are surprised that the opinions of these consultants are given precedence over physicians who are treating the person (family doctor, specialists seen through OHIP). People will often wonder how a consultant hired by the insurer who reviews sheets of paper, is more credible than a treating physician who has seen and treated the plaintiff on an ongoing basis for a long time. People will also wonder why the insurance company believes that the physician that it is paying is more credible than the treating physicians who are paid by OHIP and who have a waiting room filled with other patients that they want to get back to.
When people are sent for assessments by their insurance company, they often wonder how the doctors have been selected. Did the doctors receive some nomination from the Court or the medical profession as fair and impartial people to be able to perform these? The answer is no. The Doctors are hand selected by the insurance company or insurance assessment centres that they hire. Some of the doctors do this sort of work after having lost their hospital privileges, some do the work because of the very lucrative fees available by doing it and others for other reasons as well. There are some very fair assessors out there (I have seen them), but there are also many who my clients have had very serious concerns about. An examination of the examiner’s reputation and past history is important.
Some clients are also surprised to read the “consent” forms that the assessors require that they sign. My policy is to tell my clients not to sign any consent forms until after I have reviewed them. There are some strange surprises on those forms sometimes. One assessment centre routinely asks patients to sign agreeing “not to make any notes” about the assessment and confirm that they will not record the assessment secretly. One wonders why the assessment centre is so concerned about notes or a recording of the assessment. Clients of mine who have attended at assessments sometimes complain that they “never said what is in the doctor’s report” or about the examiner’s conduct or procedure.
Sometimes the “consent” forms contain a waiver where you are agreeing that the assessors and assessment centre cannot be sued even if they injure you through their negligence. So, even if they do something wrong and cause you injury, you cannot sue them. Another feature is that they sometimes request the right to contact your doctor about their findings – which I sometimes wonder about and consider if it might be used to try to change your own doctor’s opinions.
The long and short of it is that you do not have to accept an opinion from the insurance company’s doctor. You are entitled to test and consider that opinion in a fair and reasonable manner. Do not give that up lightly and be sure to seek legal advice before giving up. A legal consultation is free – your future benefits are too valuable to give up without a thorough investigation. After paying insurance dues for all of those years, you should not simply give up on your rights.
4. How long do I have to file a long term disability claim
Years ago, the government introduced a limitations act that appeared to standardize the amount of time that a person had to be able to start a lawsuit. That law was brought in because it had become very difficult and confusing to figure out how much time someone had to file a lawsuit in Court.
The general limitation period for many types of injury cases was set at 2 years from the date of loss or denial (this is general and you should not rely on it without speaking with a lawyer). However, two recent cases have re-ignited some uncertainty about the limitation period for challenging long-term disability benefit denials by insurance companies such as Manulife, Great West Life, Sunlife, Desjardins, and others.
Those cases are attempting to carve out an exception to the limitation act in certain types of disability benefit cases and reduce the limitation period to one year from the date of denial potentially. There are rumors that certain disability insurance companies are currently amending the wording of their policies to try to fit into the potential new exception.
There is no certainty with respect to this and it is best to speak with a lawyer to determine your precise limitation period. It may be that your precise limitation period cannot be determined with precision given these new cases and it will be better to simply commence your claim immediately.
Some well-intentioned people prefer to try to exercise every avenue of appeal of a disability denial before starting a lawsuit, but the possibility of a shortened limitation period needs to be kept in mind. At a minimum, you should obtain a complete copy of your disability benefits policy (not just the policy booklet – the actual policy) and review the wording with a long-term disability insurance denial lawyer who has experience and knowledge in the area.
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